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Agriculture summary – how the Hungarian and global sectors performed in 2024

2024 has been a difficult year for workers in Hungarian agriculture. They have faced many obstacles over the past two years, but this year the figures show that the sector’s performance has also been sharply down on last year. However, despite the downward trend in crop production, the livestock sector has seen some growth, which gives reason for optimism for the coming year. In our brief summary, we provide an overview of the sector’s performance in 2024 at the national and global level, based on data already available.

Drought, rising energy and labour costs, climate change and geopolitical tensions, rising fertiliser and animal feed prices. These are some of the features that characterise this year from an agricultural perspective. It is no wonder that in most European countries and globally, those working in the sector could have had a year worse than before, as all of the above have had an impact on production. So far, total agricultural output is 8% below the 2023 level, according to data published by the Hungarian Central Statistical Office (KSH) at the beginning of December. According to this data, the total output of the sector was over HUF 4,000 billion. The significant decline resulted from a combined contraction of 4.4% in total output and 3.8% in the price level. Crop production was 11% lower and livestock production 4.9% higher in 2024.

Based on the data available so far, the production volume of crop production in 2024 fell by 11% compared to 2023, while its price level fell by 2.5%. Overall, the volume change for cereals shrank by 16%, with barley down 29%, maize down 19% and wheat down 9.8%. Rapeseed and sunflower yields are also down, with the former falling by 31% and the latter by 13% this year. Sugar beet yields have increased, but the fall in tobacco brought the total industrial crop yield down by 11% this year compared with 2023. A reduction is also observed for fodder crops and horticultural products. Fruit is down by 12% overall, with a high contraction in the volume of apples (-31%) but an increase in peaches (+39%). Wine is down by 6% in volume terms. Despite the unfavourable crop production data, total livestock production was up 4.9% this year. Live animal production was up 5.8%, while animal products were up 2.9%.

The volume of intermediate consumption increased by 2.9%, while prices fell by 7.8% overall. On the input side, the volume of fertilisers and plant protection products is estimated to have increased by 15%, veterinary costs by 3.1% and animal feed by 2.5%. For the other inputs, there was a slight decrease or stagnation.

The gross value added of the agricultural sector fell by 13% and its volume by 17%. Labour input in agriculture was 5.6% lower, income from factors of production 15% lower and entrepreneurial income 35% lower this year than in 2023.

Since 2020, there has also been a steady decline in the annual labour unit value of unpaid agricultural labour use. Four years ago, unpaid agricultural labour use amounted to 212,292 ALU (annual labour units), while in 2024 it was only 142,011 ALU. Paid labour use has seen an increase, rising by 2,029 ALU over the last four years. Real earnings per labour unit have changed negatively compared to the previous year, falling by 15.5% compared to last year.

In terms of the extent of drought damage, the area affected by drought this year was smaller than in the past. According to the Ministry of Agriculture, farmers had reported this type of damage on 390,000 hectares of agricultural land by the beginning of September 2024. The drought has been particularly severe for water-intensive crops such as maize and sunflower, so the average yield of these crops is expected to be lower. Compared to recent years, the extent of drought damage is not particularly high, with the most significant damage in recent years occurring in 2022, when more than 1.4 million hectares were affected by drought. The lower level of drought damage has also been influenced by the fact that in recent years the relevant ministries have also sought to increase irrigation facilities with public subsidies, thus reducing the amount of land and crops that dry out. From November 2024, the Ministry of Agriculture has opened a new call for proposals to improve irrigation of agricultural land, thereby reducing the potential for drought damage in the coming season.

On a global scale, the 2024/2025 agricultural season is not yet over, with record-high global cereal yields forecast so far. According to European Union data, the EU’s cereal production could rise by 3% to 278.5 million tonnes in this period. The Food and Agriculture Organization of the United Nations (FAO) estimates that farmers could harvest 2,854 billion tonnes of grain globally. However, the dry spells have caused problems in most major grain-producing regions. Maize and sunflower yields in the Black Sea areas, important for European supplies, have fallen sharply. In addition, the spring hailstorms also caused significant damage, particularly to maize, soy and sunflower plantations. In the other major cereal-producing region, the US, heavy rains following the drought caused serious problems for agricultural workers. The rapid and heavy rainfall mainly affected soybean and maize production. The Romanian maize and sunflower production, which is outstanding in the EU, was below the average of the last five years this year due to the difficulties mentioned above. In terms of other crops, such as fruit, EU orange and apple production also faced difficulties this year. For example, exports of oranges have been steadily declining and therefore imports rising, putting even more pressure on EU producers.

Overall, the year 2024 did not bring positive results in all areas of agricultural production, especially in crop production. Both in Hungary and globally, farmers had to cope with a number of difficulties, many of which were caused by adverse weather conditions. Although the global figures for cereal production do not yet show a decline, the share of individual countries and regions has fallen. This could have a serious impact not only on prices but also on food supply, which has already been tested several times over the last more than two and a half years by the war between Russia and Ukraine.

Elemző |  Published writings

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